American Mythos III
Thursday April 23, 2026
The Medallion Fund was created in 1988. The same year Jim Simons , the founder of Renaissance Technologies turned 50.
In 1980, the year Warren Buffett turned 50, his salary from Berkshire Hathaway was $100,000 ($424,438.30 Inf. Adj.) and he had already been managing money for 30 years. To put this in perspective, his living wage was less than a dentist three years into private practice.
George Soros’ was 62 when he broke the Bank of England. Jesse Livermore was 52 when he famously shorted the stock market in 1929. Simons was essentially just a guy on the bus through middle age. (This is a bit hyperbolic but you get the point)
The Medallion Fund did decent in 1988 returning 9%. But by April of 1989, the fund was suffering from a ~30% draw-down. Jim Simons essentially fired the fund’s manager and brought in a mathematician to fix the models but not in time to save returns for 1989. The fund ended the year down -4%. Not the greatest of starts but far more successful than his previous attempts which had lost money on net.
It’s important to note that what RenTech did in the beginning was essentially to just bet against any outsized moves in the currency and commodities market and to buy contracts on Friday when everyone sold them before heading to the Hamptons and then to sell them on Monday when everyone came back into the office and bought them back. A simple retracement strategy only on a massive scale with leverage.
With the ship righted, from April 1989 through 1993, when the fund closed to public investors, RenTech return 55%,39%,33% and 39% returns on an initial investment of $16M.
Simons extracted a 5% management fee and 40% performance fee on those returns. Doing a quick back-of-the-napkin calculation this means Simons and RenTech from 1988-1993 made $7.7M ($17.8M Inf. Adj.) in fees assuming no additional capital was added to the fund.
This is a bad assumption but I don’t have data on capital additions.
Simons most likely made more money from 50-55 than he likely made the first 50 years of his life as a code breaker, university department head, and twice failed money manager.
Most people don’t realize that most wealth creation occurs in late middle age regardless of what profession you are in.
Need to TikTok this so Gen-Z relax. If you are 50 and completely free of debt with a job, you too can become a billionaire if you live long enough.
-AJ